Mr. Philip Fraser reports

KILLAM PROPERTIES INC. CLOSES $46.1 MILLION PUBLIC OFFERING OF COMMON SHARES

Killam Properties Inc. has closed its previously announced public share offering, on a bought-deal basis, of common shares to the public at a price of $10.55 per share. Killam issued 4.37 million shares, including 570,000 shares on the exercise of an overallotment option (as defined below), for gross proceeds of approximately $46.1-million.

The offering was made pursuant to an underwriting agreement with a syndicate of underwriters led by RBC Dominion Securities Inc. and including BMO Nesbitt Burns Inc., CIBC World Markets Inc., Scotia Capital Inc., TD Securities Inc., Canaccord Genuity Corp., Raymond James Ltd., Dundee Securities Ltd., GMP Securities LP and Brookfield Financial Corp. The underwriters were granted the option to purchase up to an additional 570,000 shares at the offering price to cover overallotments, if any, and for market stabilization purposes, which they exercised in full.

Killam intends to use the net proceeds from the offering to partially finance the previously announced acquisition of interests in four apartments located in Mississauga, London, Ottawa and Calgary and for general corporate purposes. Killam's portion of the purchase price for the acquisitions is $97.1-million. In the event Killam is unable to consummate one or more of the acquisitions, Killam intends to use the net proceeds of the offering otherwise allocated to such acquisitions to finance future acquisitions and for general corporate purposes.

We seek Safe Harbor.